Bernanke on Meritocracy

Federal Reserve Chairman Ben Bernanke has some excellent reflections on the ethics of meritocracy in his baccalaureate address to Princeton:

We have been taught that meritocratic institutions and societies are fair. Putting aside the reality that no system, including our own, is really entirely meritocratic, meritocracies may be fairer and more efficient than some alternatives. But fair in an absolute sense? Think about it. A meritocracy is a system in which the people who are the luckiest in their health and genetic endowment; luckiest in terms of family support, encouragement, and, probably, income; luckiest in their educational and career opportunities; and luckiest in so many other ways difficult to enumerate–these are the folks who reap the largest rewards. The only way for even a putative meritocracy to hope to pass ethical muster, to be considered fair, is if those who are the luckiest in all of those respects also have the greatest responsibility to work hard, to contribute to the betterment of the world, and to share their luck with others. As the Gospel of Luke says (and I am sure my rabbi will forgive me for quoting the New Testament in a good cause): “From everyone to whom much has been given, much will be required; and from the one to whom much has been entrusted, even more will be demanded” (Luke 12:48, New Revised Standard Version Bible).

Bernanke is picking up on two very important senses of merit. In the one sense, the one used almost exclusively in the U.S., it means to deserve something by virtue of one’s skills and abilities. I may deserve a raise because my work is excellent or I might deserve to be admitted to Princeton because I have excellent SAT scores, GPA, and extra-curriculars. The second sense is more philosophical and harder to pin down. Do I actually deserve the abilities I have? As Bernanke points out, the health, genetic endowment, family support, and opportunities that ultimately lead to our skills and abilities are not of our own making.

That said, because (partial) meritocracy is at least better than the other available systems, it does make sense to suggest that being blessed with (or lucky enough to have) the nature and nurture that allows one to do well in a meritocracy does then come with added responsibilities. Peter Singer argues forcefully that if we have the power to eliminate something bad (like extreme poverty) without sacrificing something of comparable significance, then we should.

Bernanke also points out that the U.S. is not a complete meritocracy. For those of you wondering what an absolute meritocracy might look like, Matt Yglesias uses the example of professional golf. It’s easy to define talent in golf (lowest average score), and in this case meritocracy leads to massive inequality, with a very few excellent golfers capturing almost all of the wealth.

Some form of partial meritocracy is probably the best human beings can do as an economic system. But that doesn’t mean it’s ethically justified. I’m amazed to hear it from a federal reserve chair, but hopefully more policymakers will be reminded to keep in mind the ethical shortcomings of all human institutions.


5 thoughts on “Bernanke on Meritocracy

  1. Interesting speech coming from Bernanke, I’m surprised you didn’t invoke Rawls in your commentary, these seems right up his alley. I’m also a bit skeptical…does the presence of unfairness amount to an injustice? And if it doesn’t, is it unethical? Thoughts?

    • I don’t like Rawls as much as I used to, although his lottery of birth arguments are certainly applicable. That said, I’m not sure what all they’d add to the argument that isn’t already being said. Of course, if I had invoked Rawls I could have just answered your question by saying “justice = fairness” as he basically does. I’m open to a distinction being made between the two, but as a general rule I’d say almost anything that is unfair is unjust. I tend to still broadly definite justice as each person being given his or her due. The debate then is about what each person is due, but it seems clear to me that not giving someone his or her due is unfair in addition to being unjust. The definition of justice as giving each person his or her due also works with this post since we are talking about two different ways in which a person may be ‘due’ something, by virtue of merit and by virtue of simply being human (or for Singer simply being able to feel pain). Meritocracy satisfies the normal use of ‘due’ but not the second one, the one where we remember that most of your virtues arise from a combination of your nurture and your nature, neither of which you control.

      Worth pointing out, I don’t think justice or fairness is possible; it’s just a question of becoming less unjust and less unfair. If you want to argue that justice is the best state possible even if that state is still unfair that would be an intriguing definition of the terms, but we wouldn’t actually have any underlying disagreement. And I suppose it makes sense to say there is something ethical about adopting the least unjust possibility even if, in general, we would say some of the things that happen in that state are unethical.

  2. Pingback: Critiquing Mankiw’s Defense of the One Percent | Faith and Public Policy

  3. There are surely things that are unfair that are not unjust: winning the lottery, the weather, disease, etc. I would call none of them “unjust” though. I’m open to the idea that justice is giving someone what they are due – however I’m not so sure Peter Singer is the best person to quote in this article. (For ex. why are humans due more than other animals?). Turning the argument around (more for the sake of argument rather than because I think it’s true) – but could not someone who was born with good genes and into a good family make the argument the other way? “I didn’t choose to be born into this family and with these genes, so why is it fair I have to work hard to make society better?”

    • Now your distinction seems to be that ‘unfair’ could refer to nature while ‘unjust’ is human. I’ll grant in normal speech we say that life is unfair, not unjust. That said, I’m not sure how important it is, I’d still say it is unjust to allow certain forms of unfairness to persist (i.e. to not give aid after a natural disaster or not help someone who is sick, etc). I suppose we might make an omission/commission distinction, but that would require much more writing than I’m up for right now.

      It is true that I’m being very sloppy philosophically when I combine Singer’s utilitarianism with the notion of giving each his or her due. It’s because I find Singer so compelling even though more generally I think people are due human rights, not just avoidance of pain and experience of pleasure. I suppose I’d modify Singer to say if it’s in your power to give someone their due as a human being, i.e. human rights, including life and the avoidance of pain but not limited to those, then you should do it (w/o sacrificing something of equal moral significance).

      In the correct situation the lottery of birth winner could perhaps complain about too much being expected of them if they reached a point where those expectations were causing them to sacrifice something of comparable moral significance…like their own chance to life a meaningful life and be happy (I just think this situation is very rare, particularly since most people find it enriching to help others).

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